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Mr Johnson told the CBI conference in
London: ‘High rates of personal taxation are likely to make us less
competitive.

'We should have taxes that are low but fair and it is absurd
to be suddenly whacking up taxes on cash-poor people who happen to
inhabit expensive houses in London.’

He urged politicians to be positive
about businesses and stop talking about austerity and spending cuts as
this puts ‘a big downer on growth and enterprise’.

The Mayor also encouraged foreign
billionaires to sue each other in London and their wives to launch
divorce proceedings here too, even though ministers have repeatedly
called for an end to ‘libel tourism’.

Leaders: Prime Minister David Cameron (right) is blocking proposals to impose new council tax bands on high-value properties, which George Osborne (left) is open to

He said London lawyers ‘will be grateful for your business’.

He also encouraged couples to come to Britain to divorce, to boost London's legal services.

'I
would never encourage anyone to sue, but if one oligarch feels defamed
by another oligarch, it is London's lawyers who apply the necessary balm
to the ego,' he said.

'I
have no shame in saying to the injured spouses of the world's
billionaires if you want to take him to the cleaners... take him to the
cleaners in London. Because London cleaners will be grateful for your
business.'

Senior figures have
told the Mail an increase in the rate of stamp duty on properties
selling for seven figures or a rise in capital gains tax are much more
likely.

The Treasury and the
Lib Dems admit that new wealth taxes for the best off are coming to
justify another £10billion of cuts in welfare that are necessary to keep
deficit-reduction plans on track.

Mansion tax: Nick Clegg (pictured) has held secret talks with George Osborne to draw up plans for a new tax raid on properties worth more than £1million

Mr
Osborne’s aides yesterday played down reports that he has already
agreed with Mr Clegg to push for new council tax bands, pointing out
that he has publicly described them as unworkable.

But
two other sources revealed that the Chancellor has told the Lib Dems he
is not opposed to new bands in principle. An ally admitted he regards
the plans as ‘impractical’ rather than ‘unacceptable’.

And
government officials confirmed that some sort of new property tax – be
it stamp duty or council tax – is ‘on the table’ as part of discussions
by the Cabinet Quad of the most senior ministers ahead of the autumn
statement.

Mr Cable said:
‘There needs to be a sense of fairness, and these best-off people in
society have got to contribute more. There are arguments around
taxation, about property taxation.

‘It’ll all be resolved in the next
few weeks. But certainly, the principle is right that the top of
society, the best-off, have got to pay more. This is all under
discussion.’

He added that property taxes were ‘the obvious place to go’ to tax wealth.

‘It isn’t simply that it’s fairer – it’s
that property can’t run off to Monaco and Liechtenstein; if you’re
trying to deal with abuse of the tax system, this is the best way of
doing it.’

'There needs to be a sense of fairness, and these best-off people in society have got to contribute more. There are arguments around taxation, about property taxation'

Vince Cable, Business Secretary

Treasury sources are at pains to claim that the Chancellor is just as keen as the Lib Dems to tax the wealthiest, not just as a quid pro quo for more welfare cuts.

‘We have always said the people with the broadest shoulders should bear the greatest burden,’ one said. ‘We’re committed to that. It’s not just some deal.’

The highest rate of council tax is currently Band H, levied on properties worth £320,000 or more in 1991, but that means the super-rich in multi-million-pound mansions pay no more than many whose properties have simply grown in value to around £1million now.

But sources close to Mr Cameron have indicated he does not support any change to council tax. ‘The Prime Minister is no great fan of property taxes and his view hasn’t changed,’ one said.